The India–United Kingdom Comprehensive Economic and Trade Agreement, also referred to as the India–United Kingdom Free Trade Agreement, is a free trade agreement between India and the United Kingdom.
Negotiations began in January 2022. It is the second comprehensive free trade agreement that India had concluded with a European country, after EFTA; it is the third free trade agreement signed by the United Kingdom since leaving the European Union negotiated completely anew.
India and the United Kingdom concluded negotiations for an agreement in principle on 6 May 2025.
The agreement was signed by the two countries on 24 July 2025 and came into effect on 15 July 2026.
Negotiations + India–UK FTA Round of Negotiations Round Dates Location Ref. 1 17–28 January 2022 Virtual meeting 2 7–17 March 2022 London 3 25 April–6 May 2022 New Delhi 4 13–24 June 2022 London 5 18–29 July 2022 New Delhi 6 12–16 December 2022 New Delhi 7 6–10 February 2023 London 8 20–31 March 2023 New Delhi 9 24–28 April 2023 London 10 5–9 June 2023 New Delhi 11 5–14 July 2023 London 12 8–31 August 2023 New Delhi 13 18 September–15 December 2023 London,New Delhi 14 10 January–15 March 2024 London,New Delhi 15 24 February 2025–6 May 2025 New Delhi
In May 2021, British Prime Minister Boris Johnson and Indian Prime Minister Narendra Modi agreed deeper trade co-operation between the two countries. This “Enhanced Trade Partnership” removed a number of trade barriers and set out the two countries’ intention to work towards a free trade agreement.
India and the UK launched negotiations in January 2022. Johnson declared that the agreement should be completed by Diwali 2022. Despite this, in October 2022, the Secretary of State for International Trade, Kemi Badenoch, said that the Government was no longer working to this deadline. She stated that the Government wanted “to focus on the quality of the deal rather than the speed of the deal”.
By December 2023, the UK and India had reached the 13th round of negotiations, deciding to fast track the agreement in order to complete prior to the elections in both countries the following year. Negotiations between both countries are locked in several issues, one of which is the UK's concerns about agreeing to visas for professionals demanded by India. The thirteenth round of negotiations concluded on 18 December 2023.
The fourteenth round of negotiations began on 10 January 2024. India had been pushing to include social security payments for Indian workers in the UK, Badenoch is reportedly “keen to avoid” this. In March, UK Negotiators flew to India in a “last-gasp attempt to clinch an FTA before the Indian election campaign pauses talks”, according to a UK government official, adding that India believes “they will get more out of Labour on visas and social security”. Shadow Secretary of State for Business and Trade Jonathan Reynolds and Shadow Foreign Secretary David Lammy visited India the month prior to talk with Indian officials. The UK is asking for access in India's government procurement as well as signing a bilateral investment treaty before concluding the FTA. Some British trade officials are increasingly pessimistic about the India deal and see a free trade agreement with the Gulf Cooperation Council as a more realistic deal which can be struck prior to the next election. The fourteenth round of negotiations remain open without a breakthrough on major outstanding issues between the two countries, India became primarily focused on their upcoming general election. Badenoch stated that she would not use the Indian elections as a deadline, just prior to India signing a free trade agreement with the European Free Trade Association, whose members include Iceland, Liechtenstein, Norway, and Switzerland. On 12 March, Modi and British Prime Minister Rishi Sunak agreed to work for an early conclusion of the free trade agreement, during a phone call.
On 15 March, it was announced that negotiations will be "put on ice" until spring after India's election concludes. At the beginning of April, the Indian Ministry of Commerce and Industry placed the completion of India–UK FTA as their priority for 100-day agenda after a new government takes charge. Despite the fourteenth round being declared the prior month, the round remained open by request of India in April 2024; India demanded an exemption from the UK's planned carbon tax, as well as concessions on visas for Indian workers and, a social security agreement. On 28 May, a high-ranking British delegation had abruptly cancelled its scheduled visit to New Delhi, due to the snap election announcement in the UK a few days prior.
By Spring 2024, the majority of the 26 chapters in the FTA, which include goods, services, investments and intellectual property rights were completed; the remainder of the unresolved issues were rules of origin, duty concessions on electric vehicles, Scotch whisky, social security agreement, carbon border tax, and liberalisation of financial services, in addition to a separate bilateral investment treaty.
Following Modi's re-election on 4 June, which was received positively by UK-based strategic experts and poll watchers, Modi maintained his party's stated objective to conclude the UK-India FTA negotiations within those first 100 days. India had to wait until 4 July for the conclusion of the British general election, in order to resume negotiations for the FTA. On 14 June, Modi and Sunak reaffirmed their commitment to concluding the free trade agreement at a bilateral meeting during the 50th G7 summit. Upon the election of Sir Keir Starmer as British Prime Minister, the two leaders agreed to work towards early conclusion of a mutually beneficial FTA during a phone call. During a visit to New Delhi in late July, Foreign Secretary David Lammy and Modi committed to an early conclusion for the FTA under the Starmer government.
At the 2024 G20 Rio de Janeiro summit, Starmer and Modi agreed to relaunch negotiations for an FTA in early 2025, Starmer also proposed upgrading bilateral relations by seeking a new Strategic Partnership covering energy and security. FTA talks were relaunched on 14 January 2025. On 9 April 2025, Chancellor Rachel Reeves and Finance Minister Nirmala Sitharaman announced that 90% of the trade agreement had been completed, including mobility visas for Indian workers which had been one of the most contentious negotiation issues; the outstanding issues related to whisky, cars, and pharmaceuticals. It was reported on 27 April 2025, that India had watered down its original requests in regards to visas. On 29 April 2025, Piyush Goyal declared that “25 of 26 matters have been agreed.” On 6 May 2025, Prime Minister Modi announced that an agreement had been reached between India and the United Kingdom.
Areas covered in the United Kingdom-India Free Trade Agreement The United Kingdom-India Comprehensive Economic and Trade Agreement (CETA) contains 30 chapters covering trade in goods and services, digital trade, government procurement, business mobility, intellectual property and regulatory standards.UK-India free trade agreement, Research Briefing, Number 10258, House of Commons Library, 26 June 2026, Dominic Webb https://commonslibrary.parliament.uk/research-briefings/cbp-10258/
Trade in goods
Tariff reductions and exemptions When the agreement enters into force, 64% of UK product categories exported to India immediately become duty-free, increasing to 85% over 10 years to cover two-thirds of existing UK exports. Across all tariff lines, India removes or reduces duties on 90%, covering 92% of goods currently exported from the UK to India.
Indian import duties on several key UK exports are reduced:
Spirits: Tariffs on UK whisky and gin fall from 150% to 75% when the agreement takes effect and gradually decline to 40% by Year 10. Cars: Tariffs on UK cars, previously up to 110%, are reduced to 10% under a tariff quota. The quota gradually shifts over time from internal combustion engines toward electric and hybrid vehicles. Cosmetics and toiletries: Tariffs of up to 22% on UK cosmetics and toiletries are removed immediately or gradually over 10 years. In return, the UK removes tariffs on 99% of Indian goods, providing duty-free access for major exports, including frozen shrimp, apparel and textiles.
Sector exclusions Both countries retained tariff protections for sensitive domestic sectors:
The UK maintains full tariff protections on agricultural items, including sugar, milled rice, pork, chicken, and eggs. India keeps protective tariffs on its domestic dairy sector.
Rules of origin, customs and safeguards In order to qualify for preferential tariff rates, goods must be completely obtained or significantly transformed within either country. Under a specific rule of origin, spirits distilled in Northern Ireland using imported grain qualify for preferential tariffs and could be bottled during their journey to India. Under the agreement, customs authorities must release shipments within 48 hours if no physical inspection is needed, and also publish all administrative guidance online in English. In addition to this, the agreement also allows either country to temporarily increase tariffs or withdraw tariff reductions if lower tariffs cause, or risk causing, serious harm to domestic producers in their respective countries.
Trade in services and investment
Market access for services The agreement provides equal access to specified service sectors, including telecommunications, construction and environmental services. In the sectors covered under the agreement, UK businesses are treated like Indian businesses and are not subjected to limits or quotas on the number of service suppliers. In addition to this, British businesses do not need to be based in India or register as Indian businesses in order to provide services in these sectors.
Financial and professional services Financial services: India sets a foreign direct investment limit of 74% for UK ownership of Indian insurance and banking companies. Professional qualifications: The agreement establishes a Professional Services Working Group in order to support cooperation between British and Indian regulators and to also encourage agreements on the mutual recognition of professional qualifications. Industry groups and witnesses that appeared before parliamentary committees said that the agreement largely maintains existing conditions for services instead of providing new market access. John Cooke of TheCityUK said that the agreement was “much more about confirming existing conditions of access”, whilst William Bain of the British Chambers of Commerce similarly said that it provided little new market access for services.
Government procurement
Access to Indian public contracts The agreement gives British businesses access to Indian central government procurement contracts which cover goods, services and construction. This market includes about 40,000 public tenders each year, with an estimated total value of £38 billion.
Treatment under 'Make in India' rules The agreement also gives UK businesses supplier status under India’s “Make in India” public procurement framework policy. UK businesses offering goods or services with at least 20% UK content qualify as Class 2 suppliers which allows them to bid on the same terms as Indian businesses that do not have Class 1 status.
Business mobility and social security